Fiji devalues currency amid turmoil

By The Associated Press
| 11:39 p.m.April 14, 2009

FILE - In this file photo from Nov. 30, 2006, shown is Fiji's military commander Frank Bainimarama as he gestures at the Queen Elizabeth Barracks in the capitol Suva. Fiji's president assumed control Friday April 10, 2009, and fired the judges who a day earlier had declared the military government illegal, deepening the troubled South Pacific country's political turmoil. (AP Photo/Rick Rycroft, FILE)
— AP

FILE - In this file photo from Nov. 30, 2006, shown is Fiji's military commander Frank Bainimarama as he gestures at the Queen Elizabeth Barracks in the capitol Suva. Fiji's president assumed control Friday April 10, 2009, and fired the judges who a day earlier had declared the military government illegal, deepening the troubled South Pacific country's political turmoil. (AP Photo/Rick Rycroft, FILE)
/ AP

SUVA, Fiji 
Fiji's central bank slashed one-fifth of the value from the country's currency Wednesday to try to save the economy from collapse amid a deepening political crisis over the military ruler's refusal to hold elections any time soon.

Armed forces chief Commodore Frank Bainimarama, meanwhile, accused the foreign, hired judges on Fiji's Court of Appeals of siding with critics abroad demanding that he call quick elections to restore democracy. The judges declared his coup-installed government illegal last week before being fired by the president on Friday.

Bainimarama, who seized power more than two years ago and launched a fresh crackdown after the court decision, insists he will restore democracy only after he has rewritten the constitution and electoral laws that he says are biased against the country's ethnic Indian minority.

The regime replaced some senior bureaucrats as part of the latest turmoil, including the chief of the Reserve Bank of Fiji. The new governor announced Wednesday that the Fiji dollar would be devalued by 20 percent with immediate effect to help exporters and the tourism industry.

The decision would likely send inflation soaring in the next 12 months but Fijians were being asked to "bear that burden ... so that our economy can recover quickly," Gov. Sada Reddy said. He blamed the global economic downturn for the measure.

The tourism and sugar export-dependent economy has stalled since Bainimarama seized power, and Fiji's international credit rating was downgraded last month.

President Ratu Josefa Iloilo – a Bainimarama ally – on Friday abolished the constitution, fired all judges and declared a state of emergency in response to a Court of Appeal ruling that Bainimarama's 2006 takeover was unlawful.

He reappointed Bainimarama as prime minister the next day, and has ordered a media crackdown and extended police powers as he rules by decree.

Bainimarama on Wednesday accused the three Court of Appeal judges – Australian citizens who served in Fiji, where senior lawyers are in short supply – of reaching their decision "long before they got to Fiji."

"It was quite clear that all they wanted was to force us to go into elections which we didn't want under the old system," Bainimarama told New Zealand's National Radio.

Australia and New Zealand, the largest countries in the South Pacific region, are leading international condemnation of Bainimarama, this week calling him a virtual dictator intent on maintaining power.

Bainimarama plans to hold elections by 2014 and has repeatedly said he will not rush the process, but has not explained why it would take so long.

Under the now-revoked constitution, Fiji voters cast ballots on communal lines, with indigenous Fijians, ethnic Indians and "others" voting on separate voter rolls for separate lists of candidates to represent them in the Parliament.

Indigenous Fijians have generally dominated the race-based electoral system. Ethnic Indian-dominated parties won power and held office briefly in 1987 and 2000 because some Indian lawmakers were able to successfully run for Fijian-designated seats. However, those governments were ousted in coups.

Indigenous Fijians make up about 55 percent of the population, while ethnic Indians originally brought as laborers in the 19th Century by colonial ruler Britain are now about 37 percent.

Bainimarama, an indigenous Fijian, insists all Fiji citizens are equal and has consistently attacked what he calls "racist" policies implemented by the indigenous Fijian-backed government that he ousted.

The media controls were extended Wednesday when Information Ministry officials accompanied by troops shut down two radio transmitters operated in Fiji by the Australian Broadcasting Corp.

"Events of the past few days ... confirm my fears that there is no commitment on the part of this military regime to return Fiji to democracy through free and fair elections in any acceptable timeframe," forum Chairman Toke Talagi said in a statement.

New Zealand Foreign Minister Murray McCully repeated that the United Nations should consider expelling the 280 Fijian troops being used as peacekeepers because keeping them "sustains the interim regime both in terms of credibility and ... cash."